Google Leads Company-Reputation Poll as Berkshire Slips to No. 4

Google Kirkland features a sign made of Legos in one of its hallways at its office in Kirkland, Washington. The company led Harris Interactive’s annual poll of corporate reputations. (Photo by Stephen Brashear/Getty Images)

May 2 (Bloomberg) -- Google Inc. led Harris Interactive’s
annual poll of corporate reputations and Johnson & Johnson kept
its No. 2 ranking after a year of product recalls.

The two companies beat Warren Buffett’s Omaha, Nebraska-based Berkshire Hathaway Inc., which fell from first place to
fourth in the annual survey even as its score rose. While the
public’s view of top banks improved, the financial industry
still placed ahead of only tobacco companies.

Google, owner of the world’s most popular search engine,
rose to first on the strength of its financial performance and
public admiration for its workers, said Robert Fronk, leader of
New York-based Harris’s reputation-management practice. The poll
found corporate reputations rebounding as the economy improves
and the scandals of the financial crisis recede.

“There’s still 44 percent who say that the reputation of
corporate America is still falling, but that’s down
dramatically,” Fronk said in a telephone interview. “We are
seeing a more positive story beginning to develop.”

Rounding out this year’s top five companies were St. Paul,
Minnesota-based 3M Co. in third place and, in fifth place, Apple
Inc., the Cupertino, California-based maker of the iPhone and
the world’s largest technology company by market value.

The online survey of 30,000 people ranked the reputations
of the 60 most visible companies. American International Group
Inc., the New York-based insurer rescued in a $182.3 billion
U.S. bailout, took last place. Toyota Motor Corp., the automaker
beset by recalls and reports of unintended acceleration in 2009
and 2010, dropped the most, from No. 20 to No. 43.

Before Sokol

The survey was conducted Dec. 30 to Feb. 22, before
Berkshire Hathaway executive David Sokol’s March resignation
amid revelations that he had bought shares of Lubrizol Corp., a
Buffett takeover target based in Wickliffe, Ohio. The poll also
came before last month’s criticism of Google and Apple that
their smart phones recorded data about users’ locations.

While scores improved for all 17 industries in the survey,
77 percent of the public still rated corporate images “not
good” or “terrible.”

Google’s high regard was unusual for the 12-year-old
survey, because the Mountain View, California-based company
didn’t earn especially high scores for trust, admiration and
respect -- what Harris calls “emotional appeal.” Instead, the
company scored top marks for financial dominance and its
workplace environment.

Google is known for employee perks including play rooms, a
gourmet cafeteria and on-site massages, and it’s respected for
hiring smart employees and treating them well, Fronk said.

Reputation and Sales

Respondents told pollsters they were more likely to buy
products or services from top-rated companies, and high-scorers
have tended to have less volatile stocks over the past decade.

“We have always believed that if we focus on making the
best products for our users all else will follow,” said Gary
Briggs, Google’s vice president for consumer marketing, in an e-mail. “We’re honored to be recognized in this ranking and we
will continue to put our users first.”

Harris measured reputations based on 20 attributes in six
areas: social responsibility, emotional appeal, products and
services, workplace environment, financial performance and
vision and leadership.

Johnson & Johnson’s resilience stemmed partly from decades
of “baby equity” acquired from popular, family-oriented
products such as baby powder, Band-Aids and children’s shampoo,
Fronk said. Consumers have long associated the New Brunswick,
New Jersey-based company with quality and ethical standards, he
said. J&J also was helped by media reports that didn’t identify
it as the source of recalled Tylenol and other brands, or named
only its subsidiary, McNeill Consumer Healthcare, he said.

40 Brands

J&J, the world’s second-largest maker of health-products
pulled more than 40 brands of children’s medicine and other
items last year and shut a manufacturing plant over quality
violations. In May 2010, U.S. Representative Eldophus Towns, a
New York Democrat, said company documents showed J&J
orchestrated a “phantom recall” of defective Motrin without
notifying regulators.

While J&J scored high marks for trust and ethics, only 11
percent of respondents said they would definitely buy its stock,
down from 26 percent last year. The number who said they would
definitely recommend the stock took a similar slide.

The question for J&J is whether it follows the path of
Toyota, the world’s largest automaker, Fronk said. Toyota’s
standing was relatively unchanged in the previous poll after
recalling millions of cars because of sudden-acceleration
reports. This year, the Toyota City, Japan-based company had the
biggest decline in the poll.

Toyota’s Lesson for J&J

In survey interviews, the message for J&J “came through
crystal clear and that is, ‘we’re watching how you handle all
the recalls and we’re looking to see if you do what we expect
you to do,’” Fronk said.

Where J&J has made “mistakes,” it has strived to correct
them, Chief Executive Officer William C. Weldon told
shareholders at the company’s annual meeting April 28. J&J is
spending $100 million to upgrade the factory that made most of
its recalled medicines and adopted new quality-control standards
across the corporation, he said.

“I want to encourage you to keep your faith in this great
company and the people in it” who are “directly engaged in
restoring confidence and earning back our trust and
reputation,” Weldon said.

Technology companies rated highest, with 75 percent of
people saying they had a positive view of the industry. Twenty-two percent had a positive view of the financial-services
industry, up from 16 percent last year.

Banks accounted for four of the bottom nine ranked
companies: JPMorgan Chase & Co. at No. 52; Bank of America Corp.
at 55; Citigroup Inc. at 57; and Goldman Sachs Group Inc. at 58.
JPMorgan, Citigroup and Goldman Sachs are based in New York.
Bank of America is based in Charlotte, North Carolina.